Indian markets edged lower on Friday, as trade-war worries persisted and reports suggested that special counsel Robert Mueller has subpoenaed U.S. President Donald Trump’s businesses, adding to the sense of continued political uncertainty in the U.S. Today, the start of the session is likely to be mildly on lower side. Traders may remain concern on report that India’s October-December current account deficit sharply widened from a year earlier on higher imports. The October-December current account deficit widened to 2.0 percent of gross domestic product, or $13.5 billion, compared with 1.4 percent, or $8.0 billion, in the same period a year ago. Traders will be eyeing an informal World Trade Organization (WTO) ministerial meeting to be held in New Delhi on 19-20 March, where Representatives from 50 countries will be participating. The 50 nations will engage in free and frank discussions on global trade to explore the options for resolving various issues and re-invigorating the WTO. However, traders will get some support later in the trade from report that overseas investors have pumped in nearly Rs 6,400 crore in the segment in March so far on expectations of rebound in corporate earnings and easing of global oil prices. Assocham in its report said that India should engage bilaterally with its key trading partners to promote exports if the world witnesses an escalation of trade war. Further, automotive component supplier Sandhar Technologies will open its initial public offering for subscription on March 19.
The US markets closed higher on Friday as investors reacted positively to reports showing an unexpected improvement in consumer sentiment and a bigger than expected jump in industrial production. Asian markets were trading mixed on Monday as traders remained on sidelines ahead of the Federal Reserve’s two-day policy meeting later in the week, where the central bank is expected to raise interest rates.
Back home, Indian equity benchmarks witnessed massacre on Friday with frontline gauges tumbling below their crucial 10,200 (Nifty) and 33,200 (Sensex) levels, as global markets turned defensive on concerns over the US investigation into the Trump Organization and renewed worries that US tariffs could hurt the global economy. Domestic markets started the session on pessimistic note and continued their southward movement to end near intraday lows, as sentiments remained dampened on report that India’s trade deficit for February 2018 was estimated at $11,979.21 million, 25.8% higher than the $9,521.73-million deficit reported during February 2017. Exports from the country rose 4.48% in dollar terms during February this year compared to the same month of the last fiscal. But, in rupee terms, export growth was flat with a mere 0.27% rise, reflecting a dip in value of the Indian currency. Imports rose during the month under consideration and were 10.41% higher (in dollar terms). Selling got intensified in second half of the session amid political upheaval after the Telugu Desam Party (TDP) formally decided to quit the NDA government. The Telugu Desam Party (TDP) on Friday formally decided to quit the NDA, days after two of its ministers quit the Narendra Modi government protesting for Special Category Status to Andhra Pradesh. The party will also move a no-confidence motion against the Modi government over the injustice meted out to the state. Traders failed to get any sense of relief with IMF’s statement that India should see its growth picking up this year after two transitory shocks - the demonetisation and the GST - while China’s growth is likely to fall gradually. In its G-20 Surveillance Note Global Prospects and Policy Challenges ahead of the G-20 Finance Ministers meeting in Argentina next week, the International Monetary Fund said that globally growth is expected to revert to a weaker trend. Finally, the BSE Sensex tumbled 509.54 points or 1.51% to 33,176.00, while the CNX Nifty was down by 165.00 points or 1.59% to 10,195.15.
